Apple 2005 Annual Report Download - page 8

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75 hours of video, and a 60GB model holding up to 15,000 songs, 25,000 photos, or 150 hours of video. The iPod features the Company’s
patent pending Auto-Sync technology that automatically downloads digital music, podcasts, photos, audio books, home movies, music videos,
short films, and television shows onto the iPod and keeps it up-to-date whenever it is plugged into a Macintosh or Windows computer using
USB. The iPod also features Shuffle Songs, which randomly plays songs in a selected playlist or across the entire library. All iPods work with
the Company’s iTunes® digital music management software on either a Macintosh or Windows computer.
The iPod’s functionality extends beyond playing music, listening to audio books, and watching music videos, short films, home movies, and
television shows. Other key capabilities include data storage, calendar and contact information utility, and a selection of games. With the
addition of third-party iPod peripherals, the capabilities of certain iPods can be enhanced to include photo downloading directly from certain
digital cameras. The Company has also entered into alliances with many automobile manufacturers to offer seamless integration of the iPod in
certain automobiles. Along with the iPod, the Company has developed the iTunes software and the iTunes Music Store, a service that
consumers may use to purchase third-party music, audio books, music videos, short films, and television shows over the Internet.
iPod® nano
In September 2005, the Company introduced iPod nano, a flash-memory based digital music player. The iPod nano is available in either a 2GB
model holding up to 500 songs or 25,000 photos, or a 4GB model holding up to 1,000 songs or 25,000 photos. The iPod nano, which weighs as
little as 1.5 ounces and is .27 inches thin, features a color screen and the Company’s patent pending Click Wheel.
iPod® shuffle
In January 2005, the Company introduced iPod shuffle, a flash-memory based digital music player, which is based on iPod’s shuffle feature
that randomly selects songs from the user’s music library or playlists. iPod shuffle works with iTunes and its patent-pending AutoFill feature
that automatically selects songs to fill iPod shuffle from a user’s music library on their computer. iPod shuffle can also be used as a portable
USB flash drive with up to 1GB of storage space. It is available in a 512MB model holding up to 120 songs and a 1GB model holding up to
240 songs.
iTunes Music Store®
The Company’s iTunes Music Store, available for both Windows-based and Macintosh computers, is a service that allows customers to find,
purchase, and download third-party digital music, audio books, music videos, short films, and television shows. The iTunes Music Store also
offers Podcast Directory that allows users to search for and download audio programs to their computer and automatically receive new episodes
over the Internet. Users can search the contents of the store catalog to locate works by title, artist, or album, or browse the entire contents of the
store by genre and artist. Users can also listen to a free 30-second preview of content available through the store. The iTunes Music Store was
originally introduced in the U.S. in April 2003 and now serves customers in 21 countries.
The iTunes Music Store is fully integrated directly into the iTunes software allowing customers to preview, purchase, download, organize,
share, and transfer digital content to an iPod using a single software application. Further discussion on the iTunes software may be found below
under the heading “Software Products and Computer Technologies.” The iTunes Music Store offers customers a broad range of personal rights
to the third-party content they have purchased. Content purchased through the store may also be used in certain applications such as iPhoto®,
iMovie®, and iDVD®. Additional features of the iTunes Music Store include gift certificates that can be sent via e-mail; prepaid gift cards; an
“allowance” feature that enables users to automatically deposit funds into an iTunes Music Store account every month; online gift options that
let customers give specific songs, albums, music videos, or their own playlists to anyone with an email address; parental controls; and album
reviews.
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